Walsall Council has proposed a discretionary licensing scheme intended to ban the letting of energy inefficient properties.
The plans, which are currently being consulted on, would mean that all licensees of private rented properties in Willenhall and Town Centre (& adjoining areas) will need to apply and secure a licence for each dwelling.
Licence holders will be required to comply with certain conditions, including undertaking a training course within 12 months, explaining to tenants how to store and dispose of waste properly, and explaining to their tenants how to use the property’s facilities such as gas and electrical appliances.
Continuing to let a property without a valid licence in the designated areas will be a criminal offence.
Proposed Fee Structure
None of which is (unfortunately) too unusual, an increasing number of local authorities are opting to go down the licensing route. However, what separates this proposal from the pack is the fact that a property’s energy efficiency rating will play a part in determining the cost of obtaining a licence.
The regular fee will be £714 and if you apply within the first 3 months there is a 25% discount. There is also an additional £100 discount for landlords accredited with the NLA, as well as a £50 discount for online applications.
Further discounts are available for properties with an A, B or C rating. In contrast, properties rated E, F and G face penalty charges of up to £300.
Prohibiting Energy Inefficient Properties
It gets worse!
The Council is not only looking to impact on energy efficiency through the costs of licencing fees. As part of the licence conditions, all properties must be brought up to and kept up to the Selective Licensing Property Standards (viewable here).
These property standards include the requirement for all properties to not only have an EPC, but to be in the top half of Band E. From 1st April 2018, the Council will refuse to licence any property with an EPC rating of F or G.
These clauses go above and beyond the national Minimum Energy Efficiency Standards (MEES) that will come into force from April 2018. For more information about MEES please see UKALA’s FAQs.
Although we all want to see property owners encouraged to improve the efficiency of their stock where it is possible, these clauses look likely to be detrimental to tenants who will face eviction, and landlords will be left with properties they can no longer rent out due to no fault of their own.
For example, some energy efficiency work requires third party permissions such as from the freeholder, mortgage lender, planning permission from the council or even consent from the tenants themselves. If this consent cannot be secured then under the MEES regulations they would be exempt.
However, under Walsall Council’s plans if this consent cannot be secured then the property cannot be let without being in breach of the licencing scheme and the tenant would have to be evicted.
Full details of the proposed selective licensing scheme, including how to respond, can be found on Walsall Council’s website here. The consultation is open until 8th January.